Rite Aid refinancing increases borrowing capacity, saves on annual interest expense

CAMP HILL, Pa. — Rite Aid on Tuesday announced the completion of an amendment and extension of its existing senior secured credit facility, including an increased borrowing capacity of up to $3 billion, or up to $3.7 billion when the company repays its 8% Senior Secured Notes due 2020 in full (whether at maturity or pursuant to an early redemption) and an extension of the maturity to January 2020. 

 

The company expects at current rates to save approximately $20 million in annual interest expense, based on a $3 billion facility, and approximately $50 million in annual interest expense, based on a $3.7 billion facility and the redemption of its 8% Senior Secured Notes due in 2020.

 

The company used borrowings under the amended and extended senior secured credit facility to repay and retire all of the $1.15 billion outstanding under its Tranche 7 Senior Secured Term Loan due 2020, along with associated fees and expenses.

 

The refinancing was led by Wells Fargo Capital Finance acting as syndication agent and a joint lead arranger and joint bookrunning manager; Citicorp North America acting as administrative agent and joint lead arranger and joint bookrunning manager; and Merrill Lynch, Pierce, Fenner & Smith, GE Capital Markets, Goldman Sachs Bank USA, Credit Suisse Securities and MUFG Union Bank acting as joint lead arrangers and joint bookrunning managers.